Bed Bath & Beyond shares surge after GameStop chairman reveals significant stake, pushes turnaround

GameStop chairman announces significant stake in Bed Bath Beyond

March 8, 2022: -On Monday, Bed Bath & Beyond surged more than 65% in premarket trading after GameStop Chairman Ryan Cohen revealed he had a nearly 10% stake in the retailer through his investment company RC Ventures.

Cohen, who also co-founded online pet retailer Chewy, wrote to Bed Bath’s board that he believes the retailer is struggling to reverse market share losses and navigate supply chain woes. He also criticized top executives, including Bed Bath Chief Executive Mark Tritton, for reaping excessive compensation during periods of underperformance.

“We believe Bed Bath needs to narrow its focus to fortify operations and maintain the right inventory mix to meet demand, while simultaneously exploring strategic alternatives that include separating Buybuy Baby and a full sale of the company,” said Cohen.

In response to the letter, which Bed Bath said it received Sunday evening, the big-box retailer said it had no prior contact with RC Ventures.

“We will carefully review their letter and hope to engage constructively around the ideas they have put forth,” Bed Bath said in a statement. “2021 marked the first year of execution of our bold, multi-year transformation plan, which we believe will create significant long-term shareholder value.”

Cohen’s push for changes at Bed Bath comes after the retailer in 2019 settled a months-long spat with a trio of activist investors in which four new members were added to its board. At the time, the activist group criticized Bed Bath’s e-commerce presence relative to peers, including Amazon.

Soon after that settlement was reached, the retailer brought on Tritton, a former Target executive, as CEO. His appointment sparked hope among investors that a turnaround was in the works, given Tritton’s deep merchandising experience and success at Target.

Since taking the helm of the company, Tritton has embarked on closing hundreds of underperforming Bed Bath locations, selling non-core assets including Cost Plus World Market and Christmas Tree Shops, ramping up stock buybacks, remodeling stores, debuting numerous private labels, and more recently navigating Bed Bath through a pandemic.

Cohen, however, said Bed Bath’s “scattershot strategy” isn’t working. He said the company could be better suited with a private equity owner.

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GameStop chairman announces significant stake in Bed Bath & Beyond
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GameStop chairman announces significant stake in Bed Bath & Beyond
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Bed Bath & Beyond surged more than 65% in premarket trading after GameStop Chairman Ryan Cohen revealed he had a nearly 10% stake
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The Women Leaders
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